Nintendo's portable systems aren't going to fare much better, according to Bushnell. "I don't think a handheld game-only device makes sense anymore," he said. "Not when you have an iPod, or an Android micro tablet." (Micro tablet?)

The console market is "truncating", Bushnell said. Whereas before Nintendo had almost a monopoly on younger gamers, now the other consoles serve the under-12s just as well. And these younger gamers aren't in a big rush to upgrade. At least not as much as the rest of us.

Things are only going to get tougher for the company. The Wii U will be a year old by the time the PS4 and Xbox One land, and both are way more powerful than Nintendo's console.

Bushnell should know a thing or two about falls from grace. Atari was one of the leading lights of the first wave of video game consoles. The Atari Jaguar, released in 1993, sold poorly, and was the final nail in the coffin for the troubled company.

Bushnell -- who now runs an educational software company called Brainrush -- is optimistic about the Oculus Rift virtual reality headset. "The problem with virtual reality has always been motion sickness," he said. "If they're able to really get the reality and the image right, with low latency, I think they'll get it.

"With most motion sickness you can build up immunity -- and I believe that will represent a brand new, really powerful gaming system."

Is Nintendo on the way out? What can it do to revive its fortunes? Let me know in the comments, or on our Facebook page.

About the author

Joe has been writing about consumer tech for nearly seven years now, but his liking for all things shiny goes back to the Gameboy he received aged eight (and that he still plays on at family gatherings, much to the annoyance of his parents). His pride and joy is an Infocus projector, whose 80-inch picture elevates movie nights to a whole new level.
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